One of the most important events of the 1970s was the end of the era of embedded liberalism; it brought about a change in the world order. Embedded liberalism was weakened, if not undermined, not by neo-protectionism, but by neo-liberalism (Adrian Jones 2005). Neo-liberalism entails heightened trade and financial liberalization internationally and creates competitive pressures which diminish the domestic economic autonomy of states (Adrian Jones 2005). This paper seeks to address the following question: Why did the era of embedded liberalism (1945-1974) come to an end? The aim of this study is not only to evaluate and assess the factors causing the end of embedded liberalism, but also to determine what this concept invented by Harvard's Professor John Gerard Ruggie means. It is essential to understand the main concept before it can be discussed. This paper is divided into four parts. The first part deals with the definition of the term "embedded liberalism". The second part focuses on the establishment, operation, and success of embedded liberalism before the 1970s; and the last part deals with the factors which caused the end of the embedded liberalism.
[...] Ó Riain, Sean “States and Markets in an Era of Globalization”, Annual Review of Sociology 26: 187-213. Rhodes, Martin “Subversive liberalism: Market integration, globalization and West European welfare states”, in Coleman, William D. and Underhill, Geoffrey, eds., Regionalism and global economic integration: Europe, Asia and the Americas, pp.99-121. London: Routledge. Ruggie, John Gerard Winning the peace America and world order in the new era: New York: Columbia University. Schild, Georg Bretton Woods and Dumbarton Oakes. New York: St. Martin's Press. [...]
[...] Conclusion Let us turn to the main question that I have treated in this paper: Why did the era of embedded liberalism (1945-1974) come to an end? As I have suggested, the main events provoking the end of the era of embedded liberalism were an economic recession in key states and key institutions; the abandonment of a fixed rate and the adoption of a floating system; the oil crisis of 1973; the Cold War and the end of imperialism; decolonization and the non-aligned movement; the New International Economic order (NIEO) and regionalism. [...]
[...] A large and growing number of analysts of international trade are finding Ruggie's concept of embedded liberalism an appealing one, and it now occupies a significant place in our conceptual thinking (Andrew T. F. Lang 2006). But what precisely does the term of “Embedded liberalism” mean? Adrian Jones (2005) says in a report published on the Internet that John Gerard Ruggie's idea of “Embedded liberalism” describes the policy orientation of the post-World War II international economic order, and explains the social conditions upon which it rested. [...]
[...] Therefore there was also less confidence in key institutions such as the IMF, the GATT or the World Bank (Robert Gilpin 106) As noted above, the recession did not touch only the United States but all other Western countries including France, where in the 1970s, labour productivity halved from per year to (French Ministry of Foreign Affairs 2006). France's economic trends are very closely tied to trends in Europe with regard to GDP growth, inflation and unemployment (French Ministry of Foreign Affairs 2006). [...]
[...] In the following discussion I shall try to assess the factors which brought about the end of embedded liberalism and the breakdown of the Bretton Woods system. III) What were the factors which caused the end of embedded liberalism? From the seventies onwards, there was a breakdown of embedded liberalism; it was caused by many events including recession in key states and key institutions; the abandonment of a fixed rate and the adoption of a floating system; the Oil crisis in 1973; the Cold War and the end of imperialism; decolonization and the non-aligned movement; the New International Economic order (NIEO) and regionalism. [...]
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